Quarterly report pursuant to Section 13 or 15(d)

Leases

v3.20.2
Leases
9 Months Ended
Sep. 30, 2020
Leases [Abstract]  
LEASES LEASES
We have operating leases for office space, laboratory operations, research and development facilities, manufacturing locations, warehouses and certain equipment. We determine if a contract contains a lease at inception or modification of a contract. Our leases generally do not provide an implicit interest rate, and we therefore use our incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate we would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease within a particular currency environment. We used the incremental borrowing rates as of January 1, 2019 for operating leases that commenced prior to that date. Many of our leases contain rental escalation, renewal options and/or termination options that are factored into our determination of lease payments as appropriate. Variable lease payment amounts that cannot be determined at the commencement of the lease are not included in the right-to-use assets or liabilities.
The following table presents the lease balances within the Condensed Consolidated Balance Sheet as of September 30, 2020:
(in thousands) Classification on the Balance Sheet September 30, 2020 December 31, 2019
Assets
Operating lease assets Operating lease right-of-use assets $ 36,485  $ 39,380 
Finance lease assets Property, plant and equipment, net 4,880  6,789 
Liabilities
Current
Operating lease liabilities Current maturities of operating leases 9,080  12,038 
Accrued expenses Current maturities of finance leases 2,343  2,743 
Long-term
Operating lease liabilities Operating lease liabilities 28,225  27,665 
Other long-term liabilities Finance lease liabilities $ 2,538  $ 4,046 
Weighted average remaining lease term
Operating leases 5.6 years 5.6 years
Finance leases 2.6 years 2.6 years
Weighted average discount rate
Operating leases 6.4  % 6.3  %
Finance leases 4.3  % 3.0  %
The following table reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under noncancelable operating leases with terms of more than one year to the total operating lease liabilities recognized on our Condensed Consolidated Balance Sheet as of September 30, 2020:
(in thousands) Operating Finance
October 1, 2020 through December 31, 2020 $ 3,154  $ 731 
2021 7,737  2,242 
2022 6,777  1,218 
2023 5,996  620 
2024 4,788  277 
Thereafter 17,384 
Total undiscounted future minimum lease payments 45,836  5,089 
Less: Difference between lease payments and discounted lease liabilities 8,531  208 
Total lease liabilities $ 37,305  $ 4,881 
Expense under operating leases and finance leases was $13.7 million and $2.3 million, respectively, for the nine months ended September 30, 2020, which includes $2.3 million of variable lease costs. Expense under operating leases and finance leases was $15.3 million and $2.3 million, respectively, for the nine months ended September 30, 2019, which includes $2.6 million of variable lease costs. Operating lease costs and finance lease costs are included within Operating loss in the Condensed Consolidated Statement of Operations. Short-term lease costs were not material.
Supplemental cash flow information is as follows:
(in thousands) For the nine months ended September 30,
2020 2019
Operating cash out flows from operating leases $ 13,596  $ 15,664 
Operating cash out flows from finance leases 149  306 
Financing cash out flows from finance leases 2,009  2,165 
Total $ 15,754  $ 18,135